Remuneration and negotiating

Remuneration and negotiating

When talking about pay with a prospective, future or current employer, there are many things to consider. How do you know what is a fair pay rate? How do you negotiate a good total package? What can you expect for accommodation?

Remuneration

Remuneration, or pay, comes in two forms: salary or wages.

Salary is annualised pay - Over the course of the year (or per annum) you might earn $50,000. This amount is divided and paid regularly - weekly, fortnightly or monthly.

Wages are an hourly rate of pay - Your rate of pay could be $18 per hour. The agreed rate is earnt for every hour worked and paid regularly – normally weekly or fortnightly.

How should I ask about salary or wages?

When you are close to being offered a new role, normally the topic of remuneration comes up.

What if the farmer doesn’t talk about salary or wages?

If the farm owner or manager doesn’t bring it up, you can ask what the salary is for the position. It’s not rude.

If the owner or manager says the salary is lower than you expected, you could ask if the figure is flexible.

An owner or manager may not be willing to discuss it until they make an offer.

Farm job pay rates are determined by a number of factors including your skills, experience and attributes.

There is normally a wide range of pay rates depending on the location of the job, the tasks required, the level of responsibility, the benefits, the hours to be worked, market rates and other factors.

Farming jobs often have extra benefits which can add up to thousands of dollars of value each year.

Minimum wage

You must be paid the minimum wage for each hour you work whether you’re paid hourly or on a salary.

For more information and the current minimum wage check out Employment New Zealand's minimum wage.

Remuneration review

When you first discuss your wage rate or salary, it’s a good idea to ask when your pay rate will be reviewed (if the owner or manager doesn’t mention it). This is important if you accept a salary on the lower end of what you want to be earning. You are within your rights to suggest the pay rate is discussed again at the end of the season.

Ask how the review works – what are the criteria for getting an increase? In general, remuneration reviews are strongly linked to performance and what has been achieved in the position. Often pay increases depend heavily on the financial position of the business and the farm's financial success in the year leading up to your review.

Total package

When discussing pay, it’s worth finding out the ‘total package’.

On top of wages or salary, employers may provide staff benefits. Ask if any benefits are included and make sure you are clear about what is and isn’t included in the total package. Check out our Total Package Value and Minimum Wage Calculator.

Benefit examples sometimes offered on farm

Power or landline

Firewood

Milk

Meat

Pet food and pet treatments from vets

Mobile phone

Many farms will have some of these benefits, most farms do not have all of them. Some farms could have different benefits to these and some farms may have no benefits because the pay rate is good.

Benefits are different on every farm. If you are provided with a lot of meat, the annual amount of meat could be valued up to $1000 or more per year.

Accommodation

On most farms when working fulltime you will live on farm in accommodation which is often provided for you.

Find out what you need to consider when talking about accommodation with a prospective, future or current employerhere.

Negotiating a new pay rate

Here are some tips and techniques for negotiating a new pay rate:

Be honest – be genuine and straight up. If you are being greedy and unrealistic about your remuneration expectations, the negotiation won’t go well. Clearly state your position and be prepared to either respond, accept less than you want to be earning, or walk away from the role.

Time it right – the best time to negotiate your remuneration is once the employer wants you. This may not be at your first interview, it could be at the end of your second interview or during a phone call after your interview. Once the employer has decided it’s you they want working on their farm, they will be more open to negotiating the pay rate.

Be realistic – do your research and make sure you have a good understanding of what your skills are worth in the industry. If you’ve only been farming for a year, you can’t expect to earn a Farm Manager salary rate. Aim to get the balance right between accepting a low pay rate where you feel underpaid and undervalued - and asking for too much and appearing greedy. This is a tough balance and you need to give it some thought and ask advice from someone you trust.

Compromise - don’t forget you’re negotiating to come to an agreement, so you may need to compromise. Don’t be afraid to think outside the square. For example, if you are within $1,000 and close to agreeing a pay rate, you might want to ask if the farm will financially support your farm training or study. Training has value for both yourself and for the farm business as you will gain new skills. Think smart – what things could be of value to you, but of little cost to a farm owner/manager?

Budgeting

Once your pay rate is agreed, make a budget so you can get your finances sorted and make sure you are making good use of the money you earn. Your agreed pay rate will be taxed, you will need to work out what your regular expenses are (like rent, phone costs, food etc.) then find out what you should have left over. You may want to set up a direct payment into a savings account depending on your long term financial goals.